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Feb 25, 2014

Kenya's rental income tax is high


INDIVIDUAL TAXATION

Nonresidents are taxed only on income derived from sources in Kenya. Married couples are generally taxed jointly, but they may elect for separate taxation.

INCOME TAX

Nonresidents are generally subject to withholding taxes, which serve as their final tax liability.

RENTAL INCOME
Nonresidents earning rental income from real properties is subject to a withholding tax at a rate of 30% on the gross rental income received.

Stamp Duty on Property Leases

Stamp duty is levied on property leases at varying rates, depending on the lease duration. Stamp duty is levied at a flat rate of 1% on period leases up to 3 years, and at a flat rate of 2% on period leases exceeding 3 years.

STAMP DUTY ON PROPERTY LEASES

LEASE PERIOD RATE
Up to 3 years 1%
Over 3 years 2%

CAPITAL GAINS
No tax is levied on capital gains realized from the sale of real property in Kenya.

Stamp Duty on Property Transfers

Stamp duty is levied on property transfers at varying rates, depending on the location of the property. Stamp duty is levied at a flat rate of 4% on properties located in municipalities, and at a flat rate of 2% on properties located outside municipalities.

STAMP DUTY ON PROPERTY LEASES

PROPERTY LOCATION RATE
in a municipality 4%
Outside a municipality 2%

PROPERTY TAX


Property Tax

This is an annual tax levied by the local government depending on the location and value of the property. It is usually about 1% of the property value.

Land Tax

Land tax is a local tax with rates varying depending on the location of the land. The highest rate is 8% which applies in Nairobi.

CORPORATE TAXATION

INCOME TAX

Income of nonresident companies is subject to income tax at a flat rate of 37.50%. Income-generating expenses are deductible when calculating taxable income.

 





Comments

#1 SUSAN M | April 28, 2010

when is withholding rate charged at 15%

#2 ULUMA HENRY NAKHAULI | May 12, 2010

There is eight classes of W/T allowance'Why is it and you have not published in the newspaper for favour and surerity of our examination?

#3 NYAMS | June 02, 2010

Withholding rate charged at 15% is ongovernment bearer bond of at least two years duration and other
sources,

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